BY PHILIP KIRSCHNER
Originally published in The Star Ledger

A new economic reality is confronting New Jersey. And it is critical that our government leaders recognize it and act on it now, before more damage is done to the state's economy. The new reality is this: Private-sector job growth, the best indicator of any state's economic health, stalled in 2007, then collapsed in January.

This slump did not come out of left field. New Jersey has badly trailed the nation in its rate of job growth over the last seven years (see chart below). While the nation added more than 4 million private-sector jobs between 2000 and 2007, New Jersey added just 3,800, barely keeping its head above water. Then in January, private-sector employment collapsed with a loss of 9,200 jobs, the worst one-month drop in nearly five years, according to state employment data.

Private-sector employers — fed up with rising costs and an increasingly difficult business climate — are either scaling back their hiring plans in New Jersey or taking their jobs elsewhere.

But this is only half the problem.

The other half is that many of the state's policymakers -- the folks who pass and approve the laws that affect job growth -- don't want to believe there's anything seriously wrong with the state's economy. They want to believe, or choose to believe, that things are okay -- that the current employment situation is just part of a normal economic slowdown.

The evidence to the contrary is overwhelming.

While New Jersey was losing 9,200 jobs in January, private-sector employment in the nation as a whole increased by about 1,000 jobs.

It's not hard to figure out why. Time and again, national surveys and state-by-state comparisons have shown New Jersey to be one of the most heavily taxed and regulated states in the nation. They also show New Jersey to have one of the nation's worst business climates — a direct result of high taxes, burdensome regulations, and overall high business costs.

In responding to the New Jersey Business & Industry Association's 2008 Business Outlook Survey, employers said the high overall cost of doing business is one of their biggest problems. Only 19 percent said New Jersey is a good place for expansion of their business facilities.

According to CEO Magazine, the nation's chief executives rank New Jersey's business climate 47th among the states. The Small Business Survival Index ranks New Jersey dead last.

Employers aren't the only ones who are unhappy with high and rising costs. So, too, is the public. A Rutgers University study finds that far more people are leaving New Jersey than are coming, and that the rate of out-migration has been rising, reducing the state's population growth and its personal wealth. A recent statewide poll found that half of New Jerseyans would like to move out of the state, with most citing high housing costs and taxes as the reason they want to leave.

This is why NJBIA and its member companies have been fighting passage of a paid family leave mandate in the Legislature. Despite its good intentions, the mandate would greatly impair the ability of employers to operate their businesses and meet their customers' needs. NJBIA members have sent 50,000 messages to legislators and the governor opposing it. Yet, state policymakers seem to be oblivious. We are teetering on the edge of recession, we are losing jobs, and they want to impose a huge new mandate that has been adopted by only one other state, California.

We say: Enough is enough!

What New Jersey needs now, more than ever, is to have its government leadership focus fiercely on what can be done to strengthen the state's business climate and create new jobs. Businesses are tired of elected officials who say they support a growing economy and small business, only to take actions that contradict their words, like voting for paid family leave.

A new economic reality is facing New Jersey, and confronting it effectively will require new thinking from our political leaders. They should start by removing, instead of heightening, obstacles to job creation and business success. Stopping a new paid family leave mandate would be a good start.